avianca 8-year financial forecast

Avianca 8-Year Financial Forecast

CONFIDENTIAL– SUBJECT TO NDA

Augus t 2021

2

This document consolidates information from Avianca Holdings S.A. (the “Company”) and its subsidiaries, including unaudited financial figures, operational managerial indicators, financial indicators and

managerial projections of future performance, in line with the Company’s and its subsidiaries’ current business plans. References to future results are indicative and do not constitute a guarantee of performance

by the Company, its stakeholders, management or directors. Unaudited accounting and financial information and projections presented in this document are based on internal data and calculations made by the

Company, which may be subject to changes or adjustments and may differ from actual results under IFRS. Any change in the current economic conditions, the aviation industry, fuel prices, international markets

and external events, as well as the Company’s Chapter 11 plan, among others, may affect the Company’s results and future projections.

Certain statements in this presentation, including statements regarding the further impacts of the COVID-19 pandemic and steps we plan to take in response thereto, are forward-looking and thus reflect our

current expectations and estimates with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks

and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words

such as “expects,” “projects,” “will,” “plans,” “anticipates,” “indicates,” “remains,” “believes,” “estimates,” “forecast,” “guidance,” “outlook,” “goals,” “targets” and similar expressions are intended to identify forward-

looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future

effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured, especially in light of the ongoing COVID-19

pandemic and the resulting grounding of part of our fleet. All forward-looking statements are based upon information available to the Company on the date of this presentation and the Company’s current

expectations, estimates and assumptions regarding future events and are applicable only as of the dates of such statements. Readers are cautioned not to put undue reliance on such forward-looking

statements. We undertake no obligation to publicly update or revise any forward-looking statement, estimate or projection, whether as a result of new information, future events, changed circumstances or

otherwise, except as required by applicable law.

The Company and its subsidiaries warn investors and potential investors that future projections are not a guarantee of performance and involve risks and uncertainties, including with respect to the Chapter 11

process, related negotiations and hearings before the Bankruptcy Court, as well as the COVID-19 crisis, and that actual results may differ materially. Every investor or potential investor will be responsible for

investment decisions taken or not taken as a result of his or her assessment of the information contained herein.

This information (the “Transaction Information”) does not contain all of the information material to an investment in Avianca and the restructuring transactions described herein (the “Restructuring”), and does not

constitute an offer or a solicitation of acceptances of a Chapter 11 plan within the meaning of Section 1125 of the Bankruptcy Code or otherwise. Any such offer or solicitation will be made in compliance with

any applicable securities, bankruptcy, and other applicable laws.

The Restructuring remains subject to approval of, among others, Avianca’s Board of Directors and eventually by the United States Bankruptcy Court for the Southern District of New York, which is overseeing the

Company’s Chapter 11 process. Each recipient should review the Transaction Information with its counsel as it evaluates participation in the Restructuring. Nothing contained herein shall be an admission of

fact or liability or deemed binding on any of the Company or its subsidiaries.

This presentation includes certain references to the non-IFRS measures of EBITDA, Net Debt to Adjusted EBITDA ratio.

We calculate Net Debt as long- and short-term debt minus cash and cash equivalents and short-term investments and Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, and

restructuring costs) as consolidated net profit for the year plus the sum of income tax expense, depreciation and amortization and impairment, less interest expense, interest income, derivative instruments,

foreign exchange, net and restructuring-related non-recurring expenses. We present Net Debt to EBITDA ratio because we believe it is a useful indicator of our operating performance, useful in comparing our

operating performance with other companies. However, Net Debt and Adjusted EBITDA are not measures under IFRS and should not be considered in isolation, as a substitute for net profit determined in

accordance with IFRS or as a measure of our profitability. Accordingly, you are cautioned not to place undue reliance on this information and should note that Net Debt to Adjusted EBITDA, as calculated by us,

may differ materially from similarly titled measures reported by other companies, including our competitors.

Disclaimer

CONFIDENTIAL – SUBJECT TO NDA

Significant deleveraging and improved liquidity✓

3

Executive Summary | New Strategic Direction

Avianca has developed a revised 8-year forecast to position the Company for a successful emergence from Chapter 11, featuring:

❑ Total system passenger-airline CASK ex-fuel is projected to fall by more than 41% by 2023 versus 2019 (excluding inflation)

❑ Cost reductions result from a broad and deep program that spans the organization and includes more than 300 individual initiatives, including:

▪ Significant fleet CASK improvements through improved utilization and seat densification

▪ Implementation of a ZBO program to re-size the corporate overhead and back-office functions

▪ Shift to lower-cost distribution

❑ Majority of initiatives already in implementation

❑ Average fleet ownership cost by aircraft type are expected to be reduced by over 35% through replacement of some existing aircraft with lower-cost (used)

aircraft taken from the market and repricing of other existing aircraft to current market terms

❑ All narrowbody aircraft will be reconfigured with a new densified seat layout that adds ~20% more seats per aircraft, on average, bringing Avianca’s seat

configuration in-line with its low-cost peers and greatly reducing unit costs

❑ The Company has also re-optimized its network plan to increase aircraft utilization by adding more non-hub point-to-point flying, and to serve new destinations

and new routes that are made viable as a result of the Company’s lower cost structure

Substantial reduction in fleet costs and more efficient network design✓

Dramatically lower cost structure with focus on maintaining a low-cost position✓✓

▪ Buy-on-board program in place of free meals on most short-haul flights

▪ Renegotiation of labor, maintenance and other significant contracts to drive improved efficiency and lower cost

▪ Closure of under-performing AV Peru entity

❑ The Company’s debt and IFRS-16 lease liability balance is projected to be more than US$ 2.0B lower by year-end 2021 relative to year-end 2020

❑ Leverage is projected to decrease steadily over the forecast period, with projected adjusted net-debt-to-EBITDA falling below 3.0x by the end of 2024

❑ Liquidity is forecast to remain robust, with cash as a percent of LTM revenues projected to be greater than 25% throughout the forecast period


4

Executive Summary | Projected Profitability

The emergence plan projects significant growth in profitability

Projected AVH EBITDA1

(US$ millions)

Projected AVH Pre-Tax Profit(US$ millions)

-870

-1,045-1,085

-190

56

269

373

444491

519

20262025202420232019(a) 20222020(a) 2021 2027 2028

510

-87

52

667

897

1,147

1,293

1,429

1,568

1,655

202620222019(a) 20242020(a) 202520232021 2027 2028

(1) Projected EBITDA as shown for 2021 and 2022 excludes maintenance PBH expense (as a proxy for maintenance cap-ex during the PBH period), and aircraft rentals during the PBH period (as these are excluded from the depreciation expense of the IFRS-16 right-of-use assets)

Projected Projected

EBITDA Margin 2.7% 21.4% 23.3% 26.1% 27.2% 28.4% 29.8% 30.0%Pre-Tax

Profit Margin-55.8% -6.1% 1.4% 6.1% 7.9% 8.8% 9.3% 9.4%


5

Executive Summary | Projected Cash

The emergence plan is projected to generate robust liquidity and significantly reduced leverage

0

500

1,000

1,500

2,000

2,500

3,000

JanJan OctApr Jul JulOct OctJan JanApr Jul AprOct AprApr Jul Oct Jan AprJul AprJulAprJan AprJul Oct Jan Oct Jan Oct Jan Jul OctJul

Projected AVH Cash Balance(US$ millions)

2020(A)

Projected Ratios

(Net Debt / EBITDA)12022 2023 2024 2025 2026 2027 2028

Leverage Ratio (Net Debt /

EBITDA)15.1x 3.6x 2.5x 2.0x 1.6x 1.5x 1.4x

Liquidity (YE Cash as %

of LTM Rev.)31.5% 30.1% 34.1% 36.5% 41.8% 47.7% 53.2%

(1) EBITDA used in leverage ratio calculation excludes aircraft rentals during the PBH period (as these are excluded from the depreciation expense of the IFRS-16 right-of-use assets)

2021(P) 2022(P) 2023(P) 2024(P) 2025(P) 2026(P) 2027(P) 2028(P)


02

03

04

New Strategy

Cost Transformation

Network and Fleet Plan

01 Background

05 Financial Forecast


7(1) All statistics and metrics are pre-COVID-19

(2) EBITDA excludes non-recurring expenses

❑ Network of routes with strategically located hubs in Colombia, Ecuador and El

Salvador operating 139 routes

❑ Leading carrier in Colombia, Ecuador and El Salvador with international service

❑ Dedicated freighter operations serving the Americas and Europe with 11

freighters

❑ World class loyalty program, serving 9.9+ million loyalty members

❑ World’s oldest continuously operating airline: 100 years old on 5 December 2019

Key Attributes as of 2019

Cargo AirlineLoyaltyPassenger Airline

Primary Segments

- 40% market share to/from Colombia

- Cargo operation in Colombia serving

Bogota, Cali, Medellin and

Barranquilla is strategic and scalable

- Employs 1,000+ personnel

- 11 freighters + belly capacity on

passenger aircraft

- World class loyalty program

- 9.9+ million members

- 600+ business partners

- Recognized as a leading loyalty

program; awarded with 13 Freddie

awards since 2012

Note: Not a filing entity

- Comprises 80% of the business

- 2019 fleet: 152 aircraft

- Capacity per region

- Colombia International 40%

- Colombia Domestic 15%

- Central America 13%

- Central America – US 12%

- Other South America 9%

- Ecuador 6%

- Peru Domestic 4%

❑ Avianca has the

largest market share

in its home market for

both domestic (51%)

and international (49%)

passenger services

❑ Avianca carried more

than 200,000 tons of

cargo in 2019, or more

than 40% of both the

Colombia-inbound and

Colombia-outbound air

cargo markets

Largest Airline in Colombia; Second-Largest in Latin America

2019 Route Network

Note: Avianca Peru

was placed into

liquidation on May 10,

2020, eliminating

domestic Peru routes

from Avianca network

#1

#1

2019 Key Stats

Total Revenue (EBITDA2) US$ ~4.6B (US$ ~774.8M)

ASKs (RPKs) ~54.4M (~44.4M)

Operated Routes ~139

Passengers Carried ~30M

Cargo Transported ~200,000 tons

Avianca | Leading Airline in Latin America Serving More than 28 Countries Worldwide¹


8

Avianca | Pre-COVID Overview of Key Business Units

Passenger Airline LifeMiles Avianca Cargo

Avianca benefits from a strong domestic market

and its advantageous hub locations for

connecting North, Central, and South America

Avianca’s freight and cargo operations hold the

#1 market position in Colombia and #2 in Miami,

connecting Latin America with the rest of the

world3

Freighter

Belly

US$ 154M

US$ 347M

FY2019 Revenue of

~US$ 500M4

169262

2H 20202H 2019

The freighter

business is

outperforming

due to the

COVID crisisOne of the Most Awarded

Loyalty Programs across the Americas5

(US$ M)

Revenues (US$ M)6

Bogota,

Colombia

San Salvador,

El Salvador

3,192Avg flights / week

25Cities in Colombia

22Countries

623Avg flights / week

13Countries

Direct flights to:

cities in North America

cities in South America

cities in Mexico, Central

America and Caribbean

destinations in Europe

6

12

12

4

LifeMiles maintains a strong position as the

largest and most recognized coalition loyalty

program in Colombia and Central America

Select Partners

Overview of San Salvador Hub

❑ FY2019 passenger revenues of US$ 3.9B

❑ Modern fleet1 (average age of 7 years) consisting of:

▪ 130 narrowbody and widebody aircraft

▪ 15 turboprop aircraft

9.9+ million loyalty members

Exclusive loyalty program for Avianca

US$ 334M in FY19 gross billings

Winner of 5 Global Traveler awards

Highlights of the Program

~700K co-branded credit cards

600+ commercial partners

Financial and Passenger Fleet Highlights

Bogota Hub Services a Strategic Network2

(5) Aggregate number of Freddie Awards and Global Traveler awards granted

(6) Source: unaudited management financial reports; includes only freighter revenues

(1) Fleet count and age as of December 31, 2019;

(2) Passenger flight operating statistics as of 2019

(3) Route map includes routes flown by strategic partners; from 2014 – 2020

(4) Source: unaudited management financial reports; includes freighter and belly cargo revenue

22 17 9

0

Direct flights to:

cities in North America

cities in Mexico, Central

America and Caribbean

cities in South America

9

11

4


9

Avianca | Robust Management Team

Avianca is led by a world class Senior Executive Team

❑ 20 years of experience in legal practice for the airline industry

❑ Co-Founder and former General Counsel at Azul Brazilian Airlines

❑ Senior positions in prestigious law firms focused on aviation industry

Renato Covelo – Chief People Officer

Matthew Vincett – Chief Loyalty Officer & LifeMiles CEO

❑ Led the integration of the loyalty businesses for Avianca and Taca Airlines

❑ Previously served as Commercial Vice President and Regional Airlines Vice

President at Taca Airlines

Michael Ruplitsch – Chief Information Officer

❑ 10+ years of aviation industry experience in numerous leadership positions

❑ Previously the Chief Information Officer at Austrian Airlines during the financial

crisis, helping to transform the company / support merger with Lufthansa Group

Adrian Neuhauser – Chief Executive Officer

❑ ~20 years of experience in Investment Banking, focused on Aviation with strong

experience in Latin America

❑ Senior roles at Credit Suisse, Deutsche Bank, and Bank of America Merrill Lynch

Manuel Ambriz– Chief Commercial Officer

❑ ~ 15 years of aviation experience, focused in Commercial, Network, and

Strategy

❑ Previously Chief Commercial Officer at Vueling Airlines (IAG) and Viva Aerobus

❑ Senior roles in Volaris and consulting experience in Bain & Co.

❑ Over 25 years of experience in the aviation industry, serving at numerous airlines

❑ Previously Chief Planning Officer at Qatar Airways and IndiGo

❑ Other leadership positions at Air New Zealand and LATAM

Michael Swiatek – Chief Planning Officer

❑ 20 years of experience spanning a wide breadth of roles and responsibilities

within aviation including engineering, business development, and finance

❑ Previously the CEO of Avianca Brazil

Frederico Pedreria – Chief Operating Officer

Richard Galindo – Legal VP and General Counsel

❑ 20+ years of legal experience focused on the airline industry and corporate law

❑ Prior to joining Avianca, served as director for Corporate/M&A practice group at a

top-tier law firm in Colombia

❑ ~20 years of experience in the aviation industry, with senior roles in treasury,

FP&A, and corporate strategy

❑ Previous roles include CFO of IndiGo, and SVP Corporate Strategy at United

Rohit Philip – Chief Financial Officer


10

Avianca | Strong Corporate Governance Structure

Avianca has been led through the bankruptcy process by a Board of Directors with deep experience in aviation and

restructuring

❑ Founder and CEO of Talento & Talante

❑ Expert in labor strategy

❑ Former VP Human Resources at Bancolombia Group

Jairo Burgos de la Espriella

❑ Founding Partner and CEO at Caoba Capital

❑ Former Partner at Ernst Young in Transaction Advisory for Central America

❑ Previously VP Finance, Treasury and Strategic Development for TACA Airlines

Jose Gurdian

❑ Previous Avianca CEO during transformational period (2005-15)

❑ Former Managing Director at Rothschild Group and Deutsche Bank

❑ Colombian Ambassador to OAS and General Secretary to the President

Fabio Villegas

Oscar Darío Morales

❑ Previous Partner & Board President for Deloitte in Colombia

❑ Former CEO of CARVAJAL Group

Álvaro Jaramillo

❑ Former CEO of Avianca and VP of Philadelphia National Bank

❑ President of Banco de Colombia (1994-96)

❑ Founding Partner of iQ Outsourcing (Colombia’s leading BPO)

Roberto Kriete – Chairman

❑ Chairman of Kingsland Holdings

❑ Former Director and CEO of TACA Airlines

❑ Founder and Director of Volaris

James P. Leshaw

❑ Mediator and Arbitrator at Leshaw Law

❑ Former Restructuring Partner at Greenberg Taurig LLP

❑ Over 30 years of experience as a commercial lawyer

Richard Schifter – Chair of Independent Equity Committee

❑ Senior Advisor at TPG Capital – previously a partner

❑ Former partner at Arnold & Porter

❑ Former board member of American Airlines, US Airways, and Ryanair

❑ Managing Director at Caoba Capital

❑ Director at multiple Latin American companies in the transport sector

❑ Previously a Director at Volaris

Rodrigo Salcedo

Anko Van der Werff

❑ President and CEO SAS AB

❑ Former CEO Avianca Holdings

❑ Over 15 years of Aviation industry


11

Background | 2019 Out-of-Court Restructuring Overview

After several years of poor performance, Avianca completed an out-of-court restructuring process in 2019 to address

shareholder defaults and an unprofitable business model

❑ Avianca’s focus on growth over profitability over the past decade led to stressed financials which necessitated constant refinancing

❑ In April 2019, BRW – Avianca’s then-controlling shareholder – defaulted on its loan from United Airlines, and United exercised remedies that led to governance changes at Avianca, including enhancements to the Board of Directors and new Executive Management

❑ In mid-2019 Avianca developed a comprehensive restructuring plan to improve profitability and position the Company to de-lever the balance sheet over time

▪ Fleet restructuring: simplified and shrank fleet by selling all aircraft in two fleet types (E190 and A318), and restructured aircraft orderbook (delivery deferrals, cancellations, and PDP refunds)

▪ Operating Performance: developed – and began implementing – initiatives to improve revenue performance and reduce operating costs to competitive levels

▪ Balance Sheet: Re-profiled over $5B in debt, improved cash position through asset sales and sale-leasebacks, as well as by raising US$ 375M of new liquidity

▪ Through February of 2020, the Company was tracking ahead of profitability and liquidity goals

150

179

31.2

52.6

2013 2018

Excess capacity growth…

Passenger Aircraft Capacity (ASK, B)

4.1

6.2

2018

5.94.2

2013

…Driven by increasing leverage…

Leverage Ratio1 Adjusted Debt (US$ B) 2

113212

2018

385 | (8.4%)

2013

232 | (4.7%)

….Led to stressed financials

(1) Leverage ratio reflects year-end adjusted net debt (total balance sheet debt + 7x annual rental expense less cash and cash equivalents) divided by LTM EBITDAR

(2) Adjusted debt includes total balance sheet debt + 7x annual rental expense (as an estimate of capitalized aircraft lease obligations)

EBIT (US$ M) | Margin % Interest (US$ M)

2010 - 2019

•Outsized fleet order

•Over-leveraged

•Decreasing margins and profitability

April – May 2019

• Technical defaults from controlling shareholder

• Deterioration in Company’s access to credit markets

June – July 2019

• New control and management team

• Initiation of prior restructuring plan and right-sizing of fleet

• Balance sheet restructuring through exchange offer and deferrals


12

Background | 2019 Out-of-Court Restructuring Achievements

Source: Bloomberg

Redesigned network and

strengthened BOG hub

Modified fleet to optimize

new network

Drove cost efficienciesEliminated

unprofitable routes

✓ Bond Exchange, 88.1% tendered

✓ Agreement with over $5bn of creditors, lessors and ECAs on

deferral of US$ 220M of payments – 100% participation

✓ US$ 250M convertible note facility from current stakeholder

and US$ 125M additional facility from other investors

✓ Completed sale leaseback of 9 aircraft for US$ 160M in 1Q20

✓ Aircraft sales: 10 A318s, 4 A320s, 10 E190s → provided net cash of $100M

✓ Reduction of orders from 108 to 88 for A320neo aircraft to be delivered from 2025-onwards

✓ 25 unprofitable routes cancelled from network

✓ 6.9% capacity reduction in 4Q 2019

✓ Branded fares initiative increased pricing customization to improve revenue management

✓ 4Q-2019 on-time-performance improved 504 basic points year-over-year

✓ APEX 2020 Award for the best airline in Latin America

Improved commercial

performance and customer service

Successful financial reprofiling with broad support from financial markets

The international bond market validated investor confidence in the 2019 restructuring plan, with Avianca’s debt returning from

heavily discounted levels to par value upon the completion of the restructuring

Par Value of Avianca 2020 Bond During Out-of-Court Restructuring

75%

80%

85%

90%

95%

100%

105%

Jul-19

Nov-19

Jun-19

Apr-19

Oct-19

May-19

Sep-19

Feb-20

Aug-19

Dec-19

Jan-20

100

% of Par Value

Technical default by former

ownership led to subsequent

downgrade and change of control

Change of

management, out-of-

court restructuring

commences

Avianca finalizes

restructuring plan and

accesses $125M in

additional financing

Investor confidence

restored upon

completion of out-of-

court restructuring

Business restructuring milestones achieved


13

Background | COVID Crisis

…balanced by strong freighter performance…Slow recovery in passenger demand... Avianca has controlled cash burn, and has

taken measures to dramatically cut costs

❑ Suspended debt and lease payments

❑ Deferred significant maintenance events

❑ With strong employee support, significantly reduced payroll expenses with most employees taking voluntary furloughs and temporary wage reductions

❑ Variabilized key fixed costs, most notably fleet and labor, in order to preserve cash and position the Company for restoration of passenger demand

❑ Avianca’s cargo business, which operates 11 freighters, has continued to contribute positive cashflow

❑ Total cargo revenue has increased on the back of freighter demand, despite limited belly capacity

❑ Avianca’s entire passenger fleet was grounded in March 2020 due to government-mandated hub closures in its key markets

❑ Passenger flying gradually re-commenced, with Colombia and Central American markets re-opening in September 2020

❑ Demand has started to recover, but is volatile amid recent resurgences in COVID-19 infections and changing passenger testing requirements

Mar 20

Aug 20

Jul 20

Feb 20

Jun 20

555

May 20

Apr 20

Sep 20

Feb 21

Oct 20

Nov 20

Dec 20

201199

Jan 21

Mar 21

Passengers flown per week (000’s) Cargo Revenue (US$ millions)1

0

10

20

30

40

50

60

Oct-19

Jan-19

Jul-20

Apr-19

Jul-19

Jan-20

Apr-20

Oct-20

Cash Performance (US$ millions)1

-18

32

-3

4

-12 -20 -17 -42 -71 -65 -41-100

0

100

200

300

400

500

600

700

800

900

1,000

MarFebMay Jun Jul Nov Dec JanAug Sep Oct

Cash Balance (EOM)

Operational and Fleet Cash Burn

Freighter

Belly

(1) Source: unaudited management financial reports

Following the successful out-of-court restructuring in 2019, Avianca was steadily improving when COVID hit; after filing for bankruptcy

in May 2020, Avianca has managed through the crisis and is now poised to emerge as passenger demand recovers


14

Progress Under Bankruptcy

(1) Estimates from unaudited management financial reports

In order to address the significant negative impact COVID-19 has had on Avianca’s business and the markets in which it operates,

Avianca has sought concessions from every major creditor constituency and partner

5.0

Other Unsecured or Under-secured Debt

Other Secured Debt

Major Secured Financings: Stakeholder Facility

Credit Card Securitizations

Major Secured Financings: 2023 Notes

Aircraft Financing (incl. IFRS-16 op-lease liability)

Debtor Long-Term Liabilities

as of Mar 31, 2020 (US$ billions)1

❑ Restructured major secured financings to obtain concessions and expand collateral available for DIP loan

▪ 2023 Bondholders - US$ 484M converted to approximately US$ 220M in DIP Tranche A Loans

▪ 2019 Convertible US$ 386M Stakeholder Facility – converted into subordinated Tranche B Loans with equity

conversion option for Avianca at Chapter 11 emergence

▪ Acquired minority stake in LifeMiles from co-investor Advent at an accretive price allowing additional collateral

support

❑ The Republic of Colombia sought to participate in the original DIP Tranche A Loans

❑ Credit Card Securitizations: favorable debt extensions from fully-secured securitization counterparties

▪ USAVflow – term extended by approximately 3 years, interest margin reduced from 375 bps margin to 100 bps

with modest step-ups thereafter

▪ Banco de Bogota Credit Card Securitization – likely to result in long-term low-cost loan (pending)

❑ Aircraft counterparties: negotiations with lessors and lenders have resulted in more than 35% ownership cost concessions and contributions to maintenance and cabin upgrades

❑ Over US$ 150M of unsecured or under-secured creditors to receive only general unsecured claims

❑ Pilots / Labor: secured concessions on wages, benefits, work rules, and flexible furlough rules to ensure flexibility during COVID ramp-up providing >US$ 150M in cumulative savings

❑ Suppliers: re-negotiated or rejected contracts with Engine OEMs, component support providers, real estate, and other trade suppliers

❑ Structured DIP-to-exit financing to repay original DIP Tranche A Loans and provide exit financing to support emergence


02

03

04

New Strategy

Cost Transformation


01 Background



❑ The Company took advantage of the opportunity to re-evaluate its strategic direction in light of the changing marketplace as well as the tools available to it under bankruptcy

▪ Post-COVID demand is expected to recover fastest

in the leisure and VFR segments, with slower

recoveries in business travel

▪ Ability to reject executory contracts under Chapter

11 to transform cost and fleet structure

❑ The Company engaged Oliver Wyman for a deep review of its strategic alternatives

❑ This review suggested a shift in the Company’s strategic direction to focus on an efficient cost structure and a network optimized for point-to-point leisure and VFR traffic, to improve competitiveness and to position it to align with shifts in air traffic demand

❑ The Company is transforming its cost structure, with passenger airline CASK projected to reduce to LCC levels

20182016 20192017

20%

2016 2017 2018 2019

20%

Historical Performance Indicators of Low-Cost Carriers (LCC) Relative to Full Service

In recent years, best-in-class LCC’s have demonstrably outpaced non-LCC’s in revenue and profitability

AVH Transformation Revenue and EBITDA Comparison Pre- and Post-Covid Comparison

LCC’s have higher annual revenue growth…

14%

4%

Revenue Growth

…and higher annual EBITDA margins (%)

LC

C

Sco

pe

17%

13%

EBITDA Margin

LCC’s

Non-LCC’s

LCC’s

Non-LCC’s

LCC’s have maintained higher revenue…

41%

27%

LCCs Non-LCCs

Revenue Comparison:2019 Q3 vs. 2020 Q3

…and had less severe drops in EBITDA

No

n-

LC

C

Sco

pe

-25%

-50%

LCCs Non-LCCs

EBITDA Margin Comparison:

2019 Q3 vs. 2020 Q3

Source: Capital IQ based on fixed USD conversion rate 16


17

Strategic Shift | Cost-Conscious Narrowbody Core + Complementary Business Entities

Avianca Holdings will remain a portfolio of aviation businesses, the core part of which will be a highly-efficient narrowbody operation,

with complementary entities that give scale and profitability

FUTURE CORE: COST-EFFICIENT POINT-TO-

POINT NARROWBODY

Avianca’s narrowbody operation will be the core business

and follow all core elements of a LCC, with limited defined

exceptions, and the ability to optimize for revenues due to its

superior marketpositioning

New, densified, and differentiated product optimized for cost

❑ Focus on efficiency and reduced complexity

❑ Densified cabins

❑ Unbundled fares / ancillaries

❑ Maintain BOG and grow other cities via point-to-point network

❑ Greater focus on leisure and VFR traffic

❑ Better product than LCCs

SUPPLEMENTAL BUSINESS ENTITIES

• Single fleet operation

• Simplified experience

• Accidental connectivity

STANDALONE

PROFITABILITY

Entities to be

independently profitable

(separate P&Ls)

WIDEBODY CARGO

• Separate freighters

• Also use belly of

passenger fleets

• Frequent flyer program

• Coalition revenue

• Lounges and benefits

LOYALTY


18

Strategic Shift | Cost Focus

Approach to achieving transformative cost reductions across the Company

FOCUS AREAS INITIAL TARGET IMPACT

ZERO-BASED ORGANIZATION

Rightsized the organization through

~US$65M of achieved headcount savings

NETWORK, FLEET, ALLIANCES

Design of an optimal

US$$1B+EBITDAR network

COMMERCIAL

Identified opportunities for a

3x to 4xancillary revenue increase

CUSTOMER EXPERIENCE

Identified approx.

US$80M+ of catering, lounge, and IFE savings initiatives

MAINTENANCE

Identified approx.

US$20M+ of maintenance savings

LABOR

More flexible labor contracts worth approx.

US$30M+of targeted run-rate savings in steady state

Identified & implementing approx.

US$90M+ of distribution, loyalty,

and corporate accounts initiatives

Identified & implementing approx.

~US$35M+of additional in-process initiatives


19

Strategic Shift | Network and Fleet Optimization

Given the expected reduction in unit cost, the Company developed a future network to optimize profitability

THEMES DESCRIPTION

NETWORK BUILT TO

SERVE HOME

MARKETS

• Network sized and developed around underlying home market demand characteristics

• Opening new low-frequency leisure and VFR oriented direct markets, particularly to the US – and reduces

dependence on business traffic

FAVORABLE REVENUE

POSITIONING

• Historic market position favors future passenger revenue performance

• Future revenue model gives customer choice and unlocks better ancillary performance

HIGH GROWTH,

ENABLED BY LEANER

COST STRUCTURE

• Growth of narrowbody fleet and network to expand service for Latin America as demand fully recovers

• Lean cost structure enables growth into new markets

NARROWBODY CABIN

DENSIFICATION

• Reconfiguration of all narrowbody aircraft to a configuration competitive with different market segments

• Approximately 20% increase in seats per aircraft

SUPERIOR ASSET

UTILIZATION

• Growth in aircraft utilization to 12+ BH / day

• Future growth focused on A320 fleet to improve commonality

STANDALONE

WIDEBODY

OPERATION

• Limited widebody operation to Europe, LAX that can stand on its own, and with a single fleet for reduced

complexity


02

03

04

New Strategy

Cost Transformation


01 Background



21

Cost Transformation | Passenger Airline System CASK ex-Fuel

A combination of cost reduction initiatives of ~US$ 500 million pa1 and structural changes to the fleet and network

are expected to reduce unit cost (passenger airline system CASK ex-fuel) by over 41% from pre-pandemic levels

Evolution of Projected CASK ex-fuel – System

(USD Cents / ASK)6.17

5.49

3.23 3.48

(0.17)

(0.51)

(1.33)

(0.33)

(0.60)

0.24

Initiatives Under implementation

ex-Freighter CASK ex-fuel

2019

Pax AirlineCASK ex-fuel

2023

Network,Densification,

and Other

One-time charges in 2019

Adjusted Pax AirlineCASK 2019

Non-Core Activities (est.)

Initiatives Already Implemented

Inflation Pax Airline CASK2023 w/inflation

-41.1%

Estimate of impact from non-core activities (e.g., cargo

ground handling, loyalty costs, lounge costs, etc.) that

are the responsibility of other divisions (cargo, LifeMiles)

Inflation of 1.8% p.a. assumed on all items

except fuel, ownership and maintenance

(1) Cost initiatives quantified at the 2023 projected operating levels. Cost initiatives already implemented valued at US$ 181.7 million with an additional US$ 327.7 million of initiatives currently under implementation


22

Cost Transformations | Peer Comparisons

Narrowbody Adjusted CASK ex-Fuel1 versus Stage

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600

Stage (km)

AV 2023 Curve

AV 2023(ex-inflation) Frontier

AV 2019

Copa

GOL

Volaris

AV 2023 Curve withLCC Comparable Adjustments

Spirit

System CASK ex-Fuel versus Stage

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600

Stage (km)

Azul

AV 2023 (ex-inflation)

AV 2019

Aeromexico

LATAM

AV 2023 Curve

Includes adjustments that are meant to create a more like-for-like comparison to one or more equivalent direct

low-cost carrier competitors

Projected cost initiatives should bring AVH system CASK well below those of LATAM and Aeroméxico (2019); adjusted

NB CASK1 is projected to be lower than US LCCs and comparable to Volaris (2019)

(1) Competitor data points reflect figures for 2019 from annual reports or public US DOT Form 41 reports; narrowbody adjusted CASK excludes estimated cost for non-core activities, including loyalty, lounge and cargo handling


02

03

04

New Strategy

Cost Transformation


01 Background



Network and Fleet Plan | Network Development

With a target CASK reduction established, the Company’s network planning team used a detailed modeling

methodology to develop an optimal network plan for the 8-year forecast

24

Estimate Base

Market Size

Establish Base

AVH Network Plan

Adjust Market Sizes

for Stimulation

Project Market Share and

Optimize Fleet

Assignments

• Market size reflects the total

demand (expressed as

passengers) for a given O&D

• Market size is estimated for all

potential O&Ds for each period in

the forecast

• Market size is calculated as a

function of actual pre-pandemic

market demand (industry

passengers) for each O&D

• Demand recovery curves have

been applied to the base market

size (by region) to estimate the

underlying base market demand in

each O&D at each month of the

forecast

• Market sizes from step 1 are

supplemented by market size

estimates from the gravity model

for thin or under-served markets

• The gravity model is then used to

develop an initial frequency plan

• The frequency plan is refined within

the gravity model, which accounts

for various inputs (e.g., demand

elasticity, aircraft utilization, market

yields, CASK, etc.) and produces

both a base frequency plan and an

estimate of revenue and profitability

• Once the network team is satisfied

with the plan and the preliminary

profitability estimates, the

frequency plan is further developed

into a fully-rotated schedule

• Market sizes (demand) are

adjusted for stimulation, from

both new AVH service (from the

frequency plan) and from fare

stimulation

• Market sizes may also be

adjusted downward, to reflect

the impact of service reductions

(“de-stimulation”)

• The base schedule from step 2 is

processed through a fair share

model to estimate AVH’s share of

market demand (based on its

capacity share and other

considerations)

• In addition, the schedule is also run

through a fleeting optimization

model to improve fleet assignments

(e.g., A319 vs. A320)

iterate, as needed

Project AVH Profitability

• The network team uses a

sensitivity model to forecast AVH

traffic and revenue for the final

rotated schedule

• The FP&A team uses the final

schedule and revenue forecast to

develop a cost base and full

profitability project for the network

1 2

2b

3 4

(1) The complete network planning process is much more complex, with more nuanced steps and iterations to arrive at a more robust forecast of the network, passengers and revenue


25

Network and Fleet Plan | Changing Revenue Model and Mix

The network plan leverages the Company’s lower cost structure to stimulate demand and offer new service in markets

that previously were not viable

DRIVERS AND KEY CHANGE DESCRIPTION IMPACT

Market growthPrice elasticity • Attractive pricing stimulates demand in leisure / VFR markets

Service stimulation & market

substitution • Adding direct service unlocks demand in underserved markets

Market shareNew routes and cities served • Expanded network with more unique direct routes

Densification and fleet growth • Fleet and density growth improves market share, revenues

Revenue mixAverage fare reductions • Pricing model reduces average fares (but grows passengers)

Ancillary revenue growth • Greater focus on ancillaries enables new potential revenues

Connecting revenue reductions • Point-to-point network reduces connecting revenue

Higher impact on future revenue Lower impact on future revenue

Source: Oliver Wyman


26

Network and Fleet Plan | Higher Network Density Featuring Point-to-Point Service

The revised network plan will add more low-frequency point-to-point markets to the Company’s route network

2019 service overview

Destinations 79

Routes 145

Daily departures 662

Routes per City 1.8

Departures per Route 4.6

Departures per City 8.4

2019 Network1

Future service overview (projected 2025)

Destinations 85

Routes 245

Daily departures 698

Routes per City 2.9

Departures per Route 2.8

Departures per City 8.2

Future-State Network

(projected 2025)

(1) Excludes the Peru domestic operation, which has since been discontinued


27

Network and Fleet Plan | Demand Recovery Curves

The Company’s projected network plan is based on assumed demand recovery curves by region and traffic type

67

8074

90

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

110%

Jan-22

Jan-21

Jul-23

Jul-21

Jan-23

Jul-22

Jan-24

Jul-24

Business

Leisure / VFR

Domestic MarketsProjected Percent

versus 2019 Market

Demand (passengers)

7565

90

Jul-24

Jan-21

Jan-23

Jul-21

53

Jan-22

Jul-22

Jul-23

Jan-24

Business

Leisure / VFR

70

85

Jan-22

45

Jan-21

Jul-22

Jul-21

Jan-24

55

Jan-23

Leisure / VFR

Jul-23

Business

Jul-24

Short-Haul International Markets Long-Haul International Markets

❑ In general, leisure and VFR traffic is projected to recover more quickly than business traffic, with faster recovery assumed in shorter-haul flying (domestic and

short-haul international)

❑ The Company expects leisure demand to reach 2019 levels by early 2024, while business demand remains impaired versus 2019

❑ The stronger and faster recovery in the leisure / VFR segment further supports the Company’s business model shift to focus on low-fare point-to-point flying


28

Network and Fleet Plan | Capacity Plan

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Oct JanApr Jul Jan JulApr Oct Jan OctApr Apr OctOct JanJan Jul Oct Jan OctApr Apr Jul Oct Apr Jul Apr

2019 Monthly Average

Jul Oct JulJulJan JulJanApr Jan

+31%-68% -46% -5%

Total Projected AVH Monthly Capacity (ASK millions)

2020(a) 2021 2022 2023 2024 2025 2026 2027 2028

Total Projected AVH Capacity by Year (ASK billions)

54.4

2019 (a) 2021 20232022 2024 2025

17.4

38.2

55.1

64.168.2

2026

76.0

2027 2028

70.673.3

The projected capacity plan assumes the Company will recover to 2019 ASK levels by mid-2023


29

Network and Fleet Plan | Fleet Plan

Fleet count is expected to return to pre-COVID levels in 2025 after shifting the mix towards more narrowbodies

Projected Passenger Fleet Count

(total fleet including spares and PBH)

23 21 2112 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12

109103

70 85 89 92104 108

116 118 122 125 127 129 133 136 139 142 145

15

11

11

147

Mar-21

134

Jun-21

128

Sep-21

145

116

Dec-21

102

141

130135

97101

139

104

120

Jan 20 (a)

137

151154

157

Jun-22 Dec-22 Jun-23 Dec-23 Jun-24 Dec-24 Jun-25 Dec-25 Jun-26 Dec-26 Jun-27 Dec-27 Jun-28 Dec-28

148

Projected Daily BH Utilization (total fleet, inc. spares)

2022 2023 2024 2025 2026 2027 2028

Narrowbody 10.0 11.8 11.8 11.9 12.0 11.9 11.9

Widebody 7.2 9.3 12.8 13.3 13.3 13.3 13.2

TP

NB

WB


30

Network and Fleet Plan | Fleet Plan Overview

The actual fleet plan could change as negotiations with fleet counterparties continue

* Aircraft forecast to be on PBH agreement: widebody aircraft through mid-2023 and narrowbody aircraft through mid-2022

Note: forecast remaining lease term of widebody aircraft is 11-years and for A320-NEOs 12-years

Projected Fleet

Sep-21 YE-2026 YE-2027 YE-2028

A319 10 10 10 10

A320-CEO 61 73 56 43

A320-NEO 14 50 73 92

Total Narrowbody 85 133 139 145

Total Widebody 12 12 12 12

Total Freighter 11 11 11 11

Total Fleet (on PBH or fixed rental) 108 156 162 168

Avg Remaining Lease Term (months) 104.7 77.2 83.6 87.2

Total Fleet Count

(includes spares and aircraft on PBH) *


31

Network and Fleet Plan | Assumed Aircraft Movements

From 2024 forward, net fleet growth is limited to at most +6 aircraft per year; however, there are many more fleet

transactions in each year (renewals, additions, expirations) – particularly in 2026 – 2028

Narrowbody Fleet Movements by Year

4.0 6.0

23.0 19.0

24.0

15.0 12.0

6.0 1.0 2.0 1.0 3.0

(38.0)

(2.0)

(18.0) (16.0)

202720252021 2022 2023 2024 2026 2028

Additions from Airbus Order

Additions from Other Sources

Lease Rejections / Expirations

Net Narrowbody Fleet Additions (14) +15 +12 +6 +5 +6 +6 +6

Narrowbody Lease Renewals - - 3 - 2 9 14 4

• Operating leases were assumed to be renewed at the end of the initial lease term if the aircraft age at lease expiry is less than 18 years old

• From 2022 forward, while most fleet additions are projected as A320-NEOs, there are 6 used A319s and 8 used A320-CEOs that are assumed to be

added to the fleet throughout the forecast period (counted as fleet additions in the chart above)

• All used aircraft added to the fleet are assumed to be acquired on operating lease; for new aircraft, a mix of operating lease and debt financing has

been assumed

• The forecast assumes reinstatement of the Airbus order, with 88 A320-NEOs to be delivered between 2025 and 2030


32

Network and Fleet Plan | Ownership Cash Flows1,2 versus Debt and Lease Liabilities

A320-CEO fleet is gradually replaced from 2027+, as A320-CEO leases expire and A320-NEOs are delivered from the

Airbus order, driving the increase in fleet debt & lease liabilities at the back-end of the forecast period

Widebodies2

16135

265 292 312 329

2,476

0

500

1,000

1,500

2,000

2,500

2021 2022

1,325

2023 2024 2025

1,297

2026 2027 2028

376444

1 Ownership cash flows as shown include fixed monthly lease payments and debt service payments; not included are variable PBH payments, up-front security deposits and down payments on debt-financed aircraft2 All widebodies are assumed to be on PBH through mid-2023

Turboprops and Narrowbodies

69 69 69 69 69

307

0

50

100

150

200

250

300

350

400

450

216

35

20262021 2022

415

2023 2024 2025 2027 2028

0 0

17

10956

0

50

100

150

200

250

172

2021

34

2022

34

2023

34

2024 20262025 2027 2028

34 34 34 34

Freighters

1 3 4 5 5 811

21

35

78

0

25

50

75

100

202620222021 20242023 2025 2027 2028

0

Spare Engines

US$ millions

US$ millions

US$ millions

US$ millions

1

The plan includes a number of spare engines for the

A320NEO fleet that have been added under assumed long-

term operating lease financings that would be subject to

capitalization under IFRS-16

Fixed Fleet Ownership Cash Flows

Fleet Debt & Lease Liability Balance


2022

33

Network and Fleet Plan | Ownership Cash Flows1,2 versus Debt and Lease Liabilities

A320-CEO fleet is gradually replaced from 2027+, as A320-CEO leases expire and A320-NEOs are delivered from the

Airbus order, driving the increase in fleet debt & lease liabilities at the back-end of the forecast period

1,977

2,828

0

500

1,000

1,500

2,000

2,500

3,000

Projected Aircraft and Spare Engine Ownership Cash Flows1,2

versus Debt and Lease Liabilities

2023 2024 2025 2026 2027 20282021

170

336399 420 437

487558Fixed Fleet Ownership Cash Flows1

Fleet Debt & Lease Liability Balance

US$ millions

1 Ownership cash flows as shown include fixed monthly lease payments and debt service payments; not included are variable PBH payments, up-front security deposits and down payments on debt-financed aircraft2 All widebodies are assumed to be on PBH through mid-2023


34

Network and Fleet Plan | Revenue Forecast

Projected Load Factor(RPK per ASK)

81.5%71.3%

84.4% 81.2% 83.3% 83.4% 84.3% 84.2% 84.0%

20212019 (a) 2022 202720252023 2024 2026 2028

+3.0%

Projected Average Fare + Ancillaries (US$ per pax)

Projected Yield(US cents per RPK, inc. ancillaries)

7.88.5

6.8 6.3 6.2 6.3 6.4 6.5 6.7

2027202420212019 (a) 2022 2023 2025 2026 2028

-15.1%

114.0

82.4 82.088.3

97.0 97.8 98.9 100.4 101.9

2019 (a) 20252021 202820272022 2023 2024 2026

-10.6%

Projected Average Fare (US$ per pax)

108.6

76.1 70.5 74.883.0 82.7 84.0 85.7 87.4

2019 (a) 2021 202520242022 2023 2026 2027 2028

-19.5%

The emergence plan features higher load factors but significantly lower fares

(1) Projected load factor in 2022 reflects densification program not completed until 2H-2022

1

Actual

Projected


35


Capacity(ASKs, billions)

10

0

20

30

60

40

50

70

80

2022 20262019 (a) 2021

70.6

20282023 2024

54.4

2025 2027

17.4

38.2

76.073.3

55.1

64.168.2

+39.7%

6.4 6.15.7

5.1 5.1 5.3 5.4 5.5 5.6

7.0

0.0

4.0

1.0

2.0

3.0

6.0

5.0

8.0

9.0

10.0

11.0

12.0

20222021 20272019 (a) 2023 2024 2025 2026 2028

-12.6%

8.5

11.2

8.2

7.0 6.8 7.0 7.1 7.2 7.3

2022 20252024 202820232019 (a) 20262021 2027

-14.5%

Passenger Traffic(RPKs, billions)

60

10

0

40

20

70

50

30

80

20272019 (a)

53.459.5

2021

63.8

2022 20242023 2025 2026 2028

61.7

44.744.4

12.4

32.2

56.9

+43.8%

The Company has conservatively projected lower unit revenue (both PRASK and TRASK) as a result of higher capacity

(1) Projected load factor in 2022 reflects densification program not completed until 2H-2022

Passenger Revenue & Ancillaries per ASK(PRASK – US cents per ASK)

Total Revenue per ASK(TRASK – US cents per ASK)

Actual

Projected


36


The emergence plan projects significant growth in revenue

Projected Passenger Revenue + Ancillary Revenue(US$ millions)

Projected Total Revenue(US$ millions)

4,621

1,712

1,943

3,125

3,849

4,389

4,746

5,025

5,269

5,521

20242019 (a) 20262020 (a) 2021 20232022 2025 2027 2028

4,621

3,480

8951,058

2,181

2,827

3,298

3,587

3,803

4,024

4,249

202420232020 (a)2019 (a) 2021 2022 2025 2026 2027 2028

3,480


37

Network and Fleet Plan | Fuel Price Assumptions

Forecast includes the outlook for fuel prices

Assumed Base Fuel Price1

(US$ per gallon)

1.85 1.83

1.74

1.67 1.67 1.67 1.67 1.67

2H-2021 202720232022 2024 20262025 2028

• Fuel prices reflect the current prevailing jet fuel

prices and the forward price outlook as of 16 June

2021

• The company’s passenger revenue forecast was

constructed based on an industry fuel price of

US$1.65/gallon

o The Company has included a 65% fuel

recapture assumption (with a 9-month ramp-

up) to account for the expected impact of

higher fuel prices on industry fares

1 Base jet fuel price assumption before station-specific into-plane fees and local taxes


02

03

04

New Strategy

Cost Transformation


01 Background



39

Exit Debt Financing | Revised Financing Assumptions

Exit Financing Tranche A-1

Terms

Facility Size US$ 1,050 million

Collateral Secured

Issuance DIP-to-exit (from August 2021)

Interest 9.0% p.a. paid quarterly

Up-front Fees1 Commitment fee: 1.75% (PIK)

Conversion fee: 1.625% (PIK)

Maturity 7-years

Amortization Bullet

Refinancing US$ 1,085 million in Oct-2025

Refinancing

CollateralSecured

Refinancing

Terms7-year bullet; 6.25% coupon

Refinancing

Fees1

50 basis points up-front fees +

4.175% prepayment fee

Exit Financing Tranche A-2

Terms

Facility Size US$ 550 million

Collateral Secured

Issuance DIP-to-exit (from August 2021)

Interest, p.a. 9.0% p.a. paid quarterly

Up-front Fees1 Commitment fee: 1.50% (PIK)

Conversion fee: 2.125% (PIK)

Maturity 7-years

Amortization Bullet

Refinancing US$ 570 million in Oct-2023

Refinancing

CollateralUnsecured

Refinancing

Terms7-year bullet; 7.75% coupon

Refinancing

Fees1

150 basis points up-front fees +

200 basis points prepayment fee

The plan assumes a raise of US$ 200 million of incremental equity

(1) Fees are non-inclusive of arranger fees


40

Financial Forecast | Debt Projections

While the emergence plan assumes significant financing, the tools available to Avianca through Chapter 11 and a

more efficient business model will allow the Company to significantly de-lever

5.1x

2.0x

1.6x 1.5x 1.4x

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

2022 2024

3.6x

2023 2025

2.5x

2026 2027 2028

Projected Total Debt and IFRS-16 Liability Balance at Year-End(US$ millions)

Projected Net Adjusted Debt / EBITDA (1)

3,994

4,369 4,424 4,3804,283 4,327

4,885

5,290

2020(a) 202720242021 20232022

6,281

2025 2026 2028

(1) EBITDA as included in the leverage calculation excludes aircraft rentals during the PBH period (as these are excluded from the depreciation expense of the IFRS-16 right-of-use assets)

Net Debt(US$

millions)

3,016 3,385 3,267 2,885 2,549 2,224 2,369 2,353


41

Financial Forecast | Aircraft Financings

The forecast includes a tail-by-tail build up of fleet ownership costs

Projected Aircraft Debt Financing and IFRS-16

Lease Liability (inc. PDP financing)(US$ millions)

3,489

1,477

1,8241,933 1,942

1,8881,995

2,592

3,031

0

500

1,000

1,500

2,000

2,500

3,000

3,500

20222019(a) 2021 2023 2024 20262025 2027 2028

❑ Tails included in the projected fleet are based on the Company’s best estimates at the time of forecast completion of the aircraft that are likely to be retained from the Company’s existing fleet, plus incremental aircraft assumed to be taken from the market, either through operating leases or new deliveries via the Airbus order from 2025

❑ Prior to bankruptcy, Avianca’s fleet included a mix of financing structures, including finance leases, operating leases JOLCOs and term debt financing

❑ In the emergence plan, most of the Company’s aircraft are assumed to be financed with operating leases going forward, with the exception of a small number of finance leased aircraft that are assumed to remain on finance lease with revised debt amortization schedules going forward.

❑ All used aircraft added to the fleet are assumed to be acquired on operating lease, while for new aircraft, a mix of operating lease and debt financing has been assumed

❑ The forecast reflects IFRS-16 accounting for the operating leases, in which a lease liability is booked on the balance sheet at the time of lease agreement, along with a corresponding lease right-of-use asset

▪ The right-of-use asset is depreciated on a straight-line basis over the assumed term of the lease, while the lease liability is amortized through monthly rental payments that are split between an interest and principal portion

❑ The Company has made assumptions about the likely lease terms for all of the operating leased fleet; while most leases are assumed to stretch beyond the forecast period, some leases are assumed to expire and be renewed before YE-2028

(1) Most aircraft in 2021 are expected to be under a PBH rental agreement with no fixed minimums, and so the total fleet count as of YE2021 somewhat exceeds the expected network demand

YE Pax Fleet Count: 1011 134 139116 128 145 151 157

YE Freighter Fleet Count: 11 11 1111 11 11 11 11


estimated emergence forecast forecast forecast forecast forecast forecast forecast forecast

USD millions 31-Jan-21 31-Oct-21 31-Dec-21 31-Dec-22 31-Dec-23 31-Dec-24 31-Dec-25 31-Dec-26 31-Dec-27 31-Dec-28

DIP Loan (Tranches A & B) 1,693.1 - - - - - - - - -

Exit Tranche A-1 Financing / Refinancing - 1,085.4 1,085.4 1,085.4 1,085.4 1,085.4 1,085.4 1,085.4 1,085.4 1,085.4

Exit Tranche A-2 Financing / Refinancing - 569.9 569.9 569.9 569.9 569.9 569.9 569.9 569.9 569.9

Credit Card Securitizations 243.3 207.5 207.5 199.2 190.8 182.4 140.6 112.5 84.3 56.2

Engine Financing 55.4 52.6 52.6 41.5 30.4 19.4 8.3 - - -

Densification Financing - - 18.7 83.9 65.9 46.8 26.6 5.6 - -

Secured Revolving Credit Facility 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Lifemiles Debt (term loan B & revolver) 365.4 397.5 397.5 387.5 377.5 367.5 399.1 395.5 391.8 388.2

Other Corporate Debt 544.5 36.2 34.4 27.1 21.7 18.6 18.6 18.6 18.6 18.6

Total Corporate Debt 3,001.7 2,449.2 2,466.2 2,494.5 2,441.7 2,390.1 2,348.5 2,287.4 2,250.1 2,218.4

Total Aircraft Financings (debt, lease, PDP financings) 3,227.3 1,459.9 1,476.6 1,824.4 1,933.1 1,942.2 1,887.7 1,994.7 2,591.7 3,030.6

IFRS-16 Non-Aircraft Lease Liabilities 51.5 51.2 51.1 50.4 49.3 48.1 46.6 44.8 42.8 40.7

Total Debt and Lease Liabilities 6,280.5 3,960.4 3,993.9 4,369.3 4,424.2 4,380.4 4,282.8 4,326.9 4,884.7 5,289.6

42

Financial Forecast | Pro-Forma Debt Structure


43

Financial Forecast | Projected Cash Balance

It is projected that the Company’s cash balance will remain above 25% of LTM revenues in all periods

0.0

10.0

20.0

30.0

40.0

50.0

60.0

OctJan AprJul AprOctApr JulJul AprOct Jan JulApr Jul AprOct Jan JulJul Oct Jan Apr JanOct OctAprJan Oct Jan Apr Jul Jan Jan Jul Oct

Liquidity(Cash Balance as % of LTM Revenues)

2020(A) 2021(P) 2022(P) 2023(P) 2024(P) 2025(P) 2026(P) 2027(P) 2028(P)


44

Financial Forecast | Projected Liquidity and Leverage

The company is projecting significant cash generation which will allow it to reduce its leverage ratio to 2.0x about 4

years after emergence

0

500

1,000

1,500

2,000

2,500

3,000

Projected Cash Balance1 and LTM Fixed Charges2

(USD millions)

5.07 x

3.64 x

2.51 x

1.97 x

1.56 x 1.51 x1.42 x

20282022 2023 20272024 2025 2026

Projected Leverage Ratio1,3

(Net Debt-to-LTM EBITDA)

1 Projected cash balance and leverage ratio are the product of high-level adjustments to the Company’s forecast to reflect 1Q actuals, fleet changes, fuel price adjustment, and the impact of the Airbus order, with PDPs and assumed PDP financing

2 LTM fixed charges assumes no pre-payment of the exit financing and includes LTM cash rent payments (both fixed monthly payment and variable PBH payments) and debt principal and interest payments – excludes repayments of debt due to re-

financings (e.g., PDP debt repayments that are refinanced with the subsequent aircraft financing)

3 EBITDA as included in the leverage calculation excludes maintenance PBH expense (as a proxy for maintenance cap-ex during the PBH period), and aircraft rentals during the PBH period (as these are excluded from the depreciation expense of the

IFRS-16 right-of-use assets)

545623

667724 713 738

803

2026 20272022 20282023 2024 2025

Projected Cash Balance1

LTM Fixed Charges2


❑ Total capital expenditures of US$ 3.7 billion are projected over the forecast period (2021 – 2028)

❑ The company has assumed that it will use surplus cash in the latter years (2025 – 2028) to purchase a number of A320NEOs either outright (with no financing), or with debt

❑ Heavy maintenance event costs are capitalized when incurred

▪ Total maintenance capital expenditures as shown includes maintenance PBH payments in 2021 (proxy for cap-ex during the PBH period)

❑ The forecast assumes densification of all narrowbodies, with projected net capital expenditures of US$ 137 million

45

Financial Forecast | Capital Expenditures

The emergence plan assumes heavy maintenance event costs are capitalized

Projected Capital Expenditures: Aircraft Related1

(US$ millions)

13087 114

222

409 426

2021 (Apr-Dec)

2022 2023 2024 2025 2026 2027 2028

861 860

Projected Capital Expenditures: Densification(US$ millions)

6671

2026 20282021 2022 202720252023 2024

Projected Capital Expenditures: Other(US$ millions)

4853

6266

73 74 77 79

2022 20252021 (Apr-Dec)

202720262023 20282024

Comments

(1) Includes aircraft purchases and maintenance cap-ex


actual actual forecast forecast forecast forecast forecast forecast forecast forecast

US$ M 2019 2020 2021 2022 2023 2024 2025 2026 2027 20286 6 6

Passenger Revenues 3,313.3 838.5 977.0 1,876.3 2,393.7 2,820.2 3,033.9 3,229.3 3,435.0 3,644.7

Other Passenger Related Revenues 276.9 93.3 129.0 388.2 531.9 588.7 672.4 699.8 725.4 751.5

Cargo Revenues 567.3 573.8 625.7 571.6 574.1 585.7 603.4 619.6 632.2 647.3

Loyalty Revenues 353.7 73.9 162.6 260.5 319.2 364.0 404.7 443.8 443.8 443.8

Other Revenues 110.3 132.1 48.8 28.8 29.6 30.4 31.3 32.2 32.8 33.4

Total Operating Revenues 4,621.5 1,711.6 1,943.1 3,125.3 3,848.5 4,389.1 4,745.6 5,024.8 5,269.2 5,520.7

Aircraft Fuel 1,204.1 335.6 423.8 771.9 942.7 1,019.1 1,069.1 1,100.5 1,120.0 1,139.3

Aircraft and Engine Rentals 11.8 3.4 78.5 125.9 36.0 18.6 19.6 19.6 18.0 16.0

Depreciation, Amortization and Impairment 1,064.1 534.1 434.8 398.7 453.9 512.5 561.9 663.5 739.3 767.6

Maintenance And Repairs 257.6 121.5 162.2 176.5 223.6 247.9 263.8 269.6 255.6 286.0

Salaries, Wages And Benefits 717.3 389.0 388.6 399.7 428.0 467.7 508.5 530.3 563.0 598.2

Distribution, Commissions & Other S&M Expense 500.2 169.3 188.5 293.1 361.9 407.4 441.7 470.5 479.4 497.6

Other Operations Expense 1,009.2 386.6 503.3 645.4 811.9 903.6 965.7 1,014.2 1,065.9 1,121.1

General & Administrative Expense 411.6 393.7 273.9 161.7 167.6 177.4 184.2 191.3 199.6 207.7

Total Operating Costs 5,175.8 2,333.1 2,453.8 2,972.9 3,425.6 3,754.2 4,014.6 4,259.5 4,440.8 4,633.6

EBIT (554.3) (621.5) (510.7) 152.4 422.9 634.9 731.0 765.4 828.4 887.1

EBIT Margin (12.0%) (36.3%) (26.3%) 4.9% 11.0% 14.5% 15.4% 15.2% 15.7% 16.1%

EBITDA 509.8 (87.4) (75.9) 551.0 876.8 1,147.4 1,292.8 1,428.9 1,567.8 1,654.7

EBITDA Margin 11.0% (5.1%) (3.9%) 17.6% 22.8% 26.1% 27.2% 28.4% 29.8% 30.0%

EBITDA excluding aircraft PBH payments 51.6 667.3 896.7 1,147.4 1,292.8 1,428.9 1,567.8 1,654.7

EBITDA excluding PBH Margin 2.7% 21.4% 23.3% 26.1% 27.2% 28.4% 29.8% 30.0%

EBITDAR 521.5 (84.0) 2.7 676.9 912.8 1,165.9 1,312.5 1,448.5 1,585.7 1,670.8

EBITDAR Margin 11.3% (4.9%) 0.1% 21.7% 23.7% 26.6% 27.7% 28.8% 30.1% 30.3%

Interest Expense, net 290.9 373.9 587.8 342.0 367.2 366.3 358.3 321.7 337.3 368.3

(Gains) / Losses on Asset Sales - (0.3) 20.1 - - - - - - -

Derivative Instruments and Foreign Exchange 24.8 49.6 (33.7) - - - - - - -

Total Non-Operating Costs 315.7 423.2 574.2 342.0 367.2 366.3 358.3 321.7 337.3 368.3

Pre-Tax Income (870.0) (1,044.7) (1,085.0) (189.6) 55.8 268.6 372.7 443.7 491.1 518.8

Pre-Tax Margin (18.8%) (61.0%) (55.8%) (6.1%) 1.4% 6.1% 7.9% 8.8% 9.3% 9.4%

Income Taxes 24.0 47.4 19.3 21.1 23.6 28.0 49.6 68.2 70.5 72.1

Net Income (894.0) (1,092.0) (1,104.2) (210.7) 32.2 240.6 323.0 375.5 420.6 446.7

Net Margin (19.3%) (63.8%) (56.8%) (6.7%) 0.8% 5.5% 6.8% 7.5% 8.0% 8.1%46

Financial Forecast | Summary P&L


forecast forecast forecast forecast forecast forecast forecast forecast

US$ M Apr - Dec 2021 2022 2023 2024 2025 2026 2027 2028 CUMULATIVE

Cash Flows from Operations:

EBITDAR 56.0 676.9 912.8 1,165.9 1,312.5 1,448.5 1,585.7 1,670.8 8,829.2

Add-back of non-cash items:

Maintenance and pension provisions 7.5 31.5 48.3 56.3 42.1 27.4 (2.1) 16.7 227.7

Other operating cash flows:

Income tax paid, net of refunds (68.5) (30.1) (25.6) (27.3) (44.7) (67.4) (69.9) (71.7) (405.2)

Working capital (net) (22.3) 39.6 93.6 62.2 76.4 69.9 78.3 77.4 475.0

Net Cash Flows Provided by Operations (27.3) 717.9 1,029.1 1,257.1 1,386.3 1,478.4 1,592.0 1,693.3 9,126.7

Cash Flows from Investing:

Aircraft security deposits (49.0) (8.5) (6.2) (3.5) (1.6) (2.0) (3.3) (2.2) (76.3)

Aircraft predelivery deposits, net of financing - (2.4) (7.2) 29.9 (15.6) (55.6) 16.9 1.3 (32.9)

Capital expenditures, net of financing (181.1) (211.0) (175.7) (287.8) (395.5) (368.3) (440.6) (476.8) (2,536.7)

Aircraft return expenses - - - - - (9.4) (54.7) (36.2) (100.3)

Interest income 1.1 1.4 1.5 1.9 2.4 2.7 3.3 3.9 18.2

Net Cash Flows Provided by Investing (229.0) (220.5) (187.7) (259.4) (410.3) (432.5) (478.5) (510.0) (2,728.0)

Cash Flows from Financing:

DIP - original Tranche A, B issuance (final draw) 174.5 - - - - - - - 174.5

DIP - original Tranche A repayment (1,427.9) - - - - - - - (1,427.9)

DIP-to-Exit Finanicng - issuance / refinancing 1,600.0 - 569.9 - 1,085.4 - - - 3,255.4

DIP-to-Exit Financing - repayment - - (569.9) - (1,085.4) - - - (1,655.4)

Conversion of Tranche B DIP loan to equity 934.7 - - - - - - - 934.7

Retirement of Tranche B DIP loan to equity (934.7) - - - - - - - (934.7)

Other long-term debt - new debt issuance 418.9 78.0 - - 400.0 - - - 896.9 -

Other long-term debt - debt repayment (409.4) (49.7) (52.8) (51.6) (443.8) (67.2) (59.3) (81.3) (1,215.1)

Aircraft and engine rentals (76.3) (125.9) (36.0) (18.6) (19.6) (19.6) (18.0) (16.0) (330.1)

Interest payments (98.7) (194.8) (214.6) (186.8) (254.1) (160.1) (174.6) (195.6) (1,479.2)

Payments of IFRS-16 lease liability (20.4) (96.8) (189.2) (227.5) (254.9) (280.8) (299.8) (308.2) (1,677.6)

Interest on IFRS-16 lease liability (26.2) (77.4) (151.4) (175.7) (165.1) (148.7) (149.2) (160.6) (1,054.5)

Net Cash Flows Used in Financing Activities 134.5 (466.5) (644.0) (660.2) (737.6) (676.5) (700.9) (761.8) (4,512.9)

Cash Flows from Other Activities:

Pension payments (17.1) (24.0) (24.4) - - - - - (65.6)

Purchase of LifeMiles stake (5.0) - - - - - - - (5.0)

Sale of assets (0.4) - - - - - - - (0.4)

Capitalization 200.0 - - - - - - - 200.0

Net Cash Flows Used in Other Activities 177.5 (24.0) (24.4) - - - - - 129.1

Net Cash Flow 55.7 6.8 173.0 337.5 238.4 369.4 412.6 421.5 2,014.8

Starting Cash Balance (consolidated AVH) 922.0 977.8 984.5 1,157.5 1,495.0 1,733.4 2,102.8 2,515.4 922.0

Ending Cash Balance (consolidated AVH) 977.8 984.5 1,157.5 1,495.0 1,733.4 2,102.8 2,515.4 2,936.9 2,936.9 47

Financial Forecast | Summary Cash Flow Statement


actual forecast forecast forecast forecast forecast forecast forecast forecast

US$ M 2020 2021 2022 2023 2024 2025 2026 2027 2028

Total assets 6,860.5 4,516.0 4,759.4 5,028.3 5,383.4 5,767.6 6,310.6 7,344.3 8,289.5

Cash, restricted cash, short-term investments 978.4 977.8 984.5 1,157.5 1,495.0 1,733.4 2,102.8 2,515.4 2,936.9

Current tax assets 111.8 120.6 120.6 120.6 120.6 120.6 120.6 120.6 120.6

Accounts receivable, net of provision for doubtful accounts 233.0 139.6 164.8 199.0 218.9 238.6 258.1 265.1 280.0

Expendable spare parts and supplies, net of provision for obsolescence 81.4 70.2 58.6 72.2 82.5 89.1 94.0 108.0 113.1

Prepaid expenses 36.2 46.9 57.3 84.7 82.9 148.4 137.2 124.8 114.8

Assets held for sale 0.9 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8

Deposits and other assets 93.1 113.4 121.9 128.1 131.5 133.1 135.1 138.5 140.7

Intangibles 488.9 443.6 384.2 323.4 259.1 221.1 179.6 143.8 108.1

Deferred tax assets 25.2 22.5 22.5 22.5 22.5 22.5 22.5 22.5 22.5

Property and equipment, net 3,764.6 993.3 1,082.3 1,121.3 1,278.2 1,565.9 1,916.5 2,394.4 2,901.4

IFRS-16 lease right-of-use asset (net) 1,046.9 1,587.2 1,761.7 1,798.1 1,691.3 1,493.9 1,343.2 1,510.4 1,550.5

Total liabilities 8,162.3 5,377.6 5,808.0 6,015.3 6,104.4 6,154.5 6,316.7 6,929.8 7,428.3

Long-Term Debt 4,880.9 2,466.2 2,494.5 2,441.7 2,470.9 2,549.6 2,744.3 3,143.1 3,521.3

IFRS-16 Lease Liabilities 1,400.3 1,527.8 1,874.8 1,982.5 1,909.5 1,733.2 1,582.6 1,741.6 1,768.3

Accrued interest - 17.0 16.9 20.0 19.8 23.1 24.1 26.4 27.8

Tax liabilities 68.7 10.9 1.9 (0.1) 0.6 5.6 6.3 6.9 7.4

Accounts payable and accrued expenses 525.5 369.7 478.0 552.6 592.8 630.4 656.8 694.2 728.3

Provisions for return conditions and legal claims 184.2 131.3 164.2 202.1 236.5 268.2 285.5 235.2 223.2

Employee benefits 238.6 102.9 76.5 41.6 47.3 55.9 61.0 71.9 79.1

Air traffic liability 399.2 294.1 269.4 336.2 369.0 398.1 424.4 443.9 476.3

Other liabilities 12.1 11.3 11.3 11.3 11.3 11.3 11.3 11.3 11.3

Frequent flyer deferred revenue 452.8 446.4 420.5 427.3 446.6 479.1 520.3 555.3 585.1

Total equity (1,301.8) (861.6) (1,048.6) (987.1) (721.0) (386.9) (6.1) 414.5 861.2

48

Financial Forecast | Summary Balance Sheet1

(1) Forecast assumes the sale of the Company’s interest in Servicios Aeroportuarios Integrales SAI S.A.S. in August 2021


forecast forecast forecast forecast forecast forecast forecast forecast

Operating Statistics 2021 2022 2023 2024 2025 2026 2027 20286 6 6

All flights (passenger + cargo):

Departures 131,148 191,157 230,883 243,620 250,876 259,542 258,294 269,249

BH 254,634 421,877 553,785 616,637 649,372 671,402 653,389 679,896

Passenger flights only:

Departures 121,156 191,157 230,883 243,620 250,876 259,542 270,497 281,452

BH 218,408 421,877 553,785 616,637 649,372 671,402 697,910 724,418

Kilometers (K) 108,987 209,214 296,159 340,612 363,302 376,845 391,797 406,749

Average Stage (km) 900 1,094 1,283 1,398 1,448 1,452 1,448 1,445

ASK (M) 17,367 38,190 55,061 64,108 68,230 70,609 73,300 75,992

RPK (M) 12,382 32,227 44,701 53,406 56,922 59,547 61,684 63,820

Load Factor 71.3% 84.4% 81.2% 83.3% 83.4% 84.3% 84.2% 84.0%

Seats 17,469,418 30,744,075 38,618,897 41,083,396 42,383,889 43,930,746 45,902,646 47,874,546

PAX 12,836,457 26,608,555 32,018,043 33,988,841 36,679,552 38,452,896 40,069,681 41,686,466

Average BH per Departure 1.80 2.21 2.40 2.53 2.59 2.59 2.58 2.57

Average Seats per Departure 144 161 167 169 169 169 170 170

Average Jet Fuel Price (US$ / gallon) 1.75 1.83 1.74 1.67 1.67 1.67 1.67 1.67

49

Financial Forecast | Summary Operating Statistics

Appendix – Collateral Coverage


1,085

570

-

1,000

2,000

3,000

4,000

Emergence Debt

Collateral Coverage for Exit Debt Financing

Newly performed appraisals support that the Exit Debt Financing of US$ 1.6 billion will have substantial collateral coverage (LTV of

56.2%) after upsizing of the LM debt and before accounting for the value of the COP-denominated credit card receivables

Loan to Value (LTV)

(pre- / post-upsizing of LM debt

to US$ 405M) 1, 2, 3, 4

55.0%

/

56.2%

Projected Exit Debt Finance Balance

and Collateral Coverage(US$ Millions)

First-lien pledge on certain COP-denominated

credit card receivables

Pledge of the cargo business (not inclusive of

belly cargo)

Not appraised by 3rd party

MBA Valuation: US$ 870M

Implied Equity Value after

subtraction of net debt

US$ 660M4

(MBA 6/18/21)

Available Collateral

(1) Collateral coverage projections is not inclusive of monthly estimates of credit card receivable balances, and is inclusive of expected PIK’d conversion and commitment fees upon emergence

(2) Avianca will pay purchase price of US$ 5M to acquire the remaining 10.1% upon refinancing of the existing LM debt facility.

(3) Equity stake for collateral value is calculated by subtracting gross debt of US$ 340M (pre-upsizing) or assumes LM upsizes debt to US$ 405M (post-upsizing); the net debt includes cash position of US$ 72M

(4) Assuming estimated net debt at emergence of US$ 210M, the net collateral value drops to US$ 660M

Collateral

Coverage

Tranche A-2

Tranche A-1

Equity interest

in LifeMiles

Description Valuation Summary

Avianca’s 89.9% equity interest in the LifeMiles,

as well as its nominally-priced option to

acquire an additional 10.1%2

MBA Valuation: US$ 2,159M

Implied Equity Value after

subtraction of net debt

US$ 1,891M / US$ 1,825M3

(MBA 6/18/21)

Cargo Business

COP-denominated credit

card receivables

Total Est. Collateral 1, 2, 3, 4

US$ 3,011M

First-lien pledge on Brand Intellectual Property

(i.e., Trademarks)

MBA Valuation: US$ 460M

(MBA 6/18/21)Brand Intellectual

Property

51

Appendix - Covenant Analysis


53

Fixed Charge Coverage Ratio (“FCCR”) and Leverage Ratio through Dec-2028

The FCCR is projected above 1.10 from the end of 2022 forward

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

2.0

2.1

1.5

1.0

0.5

4.0

3.5

4.5

3.0

2.5

2.0

Dec-

26

Dec-

25

Jun-

23

Jun-

28

Dec-

28

Dec-

21

Jun-

22

Dec-

22

Dec-

23

Jun-

26

Dec-

24

Jun-

25

Jun-

27

Dec-

27

Jun-

24

Leverage Ratio

FCCR

FCCR at 1.10

Leverage Ratio1


Note: The forecast as shown in this page has been adjusted to assume that exit debt is refinanced only at maturity in October 2028 (versus the standard assumption in the rest of the deck that exit debt is refinanced mid-forecast)

Fixed Charge

Coverage Ratio


54

Fixed Charge Coverage Ratio (“FCCR”) Sensitivity through 2023

The projected FCCR remains below 1.5x through 2023, and grows thereafter as projected profitability expands

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

1.5

1.6

OctApr SepFebNovDec FebJan Mar JunMay Jul Aug Sep Oct Dec Jan Mar Apr May Jun Jul Aug Nov Dec

Fixed Charge

Coverage Ratio

FCCR based on Plan EBITDAR

FCCR with 30% lower EBITDAR



FCCR at 1.1

Projected Cash Balance

(US$ millions)

2022(P) 2023(P)

1,000

600

200

1,200

400

800

Cash Balance with 10% lower EBITDAR

Cash Balance based on Plan




Note: The forecast as shown in this page has been adjusted to assume that exit debt is refinanced only at maturity in October 2028 (versus the standard assumption in the rest of the deck that exit debt is refinanced mid-forecast)

1


55

Proposed Rental Payment Covenant Levels

Annual Cash Rental Payments for Aircraft and Spare Engines (inc. PBH capital payments)

vs. Proposed Covenant Levels

169.4

296.1

372.4

417.5435.2

444.5462.2

480.1

478.7

150

200

250

300

350

400

450

500

550

2021 20252022 2023 2024 20272026 2028

Proposed 2026 - 2028 Threshold(annual rent + 10%)

Proposed 2021 - 2025 Threshold(max +10%) = $478.7 million

489.0

508.5

528.2

US$ millions

Appendix - LifeMiles


57

LifeMiles Loyalty Program | Overview

10+ million Members

~600K Active

Co-branded Credit Cards

700+ Commercial Partners

Exclusive Loyalty

Program for Avianca

Premier

Airlines

Auto/Gas

Apparel

Renowned

Restaurants

& Eateries

Best Hotels

Largest

Banks

US$ 334M in FY19

Gross Billings

1

2

5

3

4

6

Strongly positioned in its core markets as the largest and

most recognized loyalty program

Underpenetrated consumer markets foster

significant growth potential

Diversified network of Blue-Chip

commercial and financial partners

Attractive operating model generating

predictable, long-term liquidity

Proven, experienced and aligned management

team, supported by a top private equity sponsor

Exclusive agreement with Avianca, the leading carrier in

Colombia and Central America, extended through 2040

GLOBAL

PARTNERS

Key Highlights Business At-A-Glance

Winner of 5 Global

Traveler Awards and

13 Freddie Award

The LifeMiles loyalty program is uniquely positioned to continue to bolster its growth trajectory and profitability

https://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwi2kYCmiN7XAhXFaFAKHWWHDWwQjRwIBw&url=https://rocketmiles.workable.com/&psig=AOvVaw0r3eL_o2hIlOJASPDBRT0d&ust=1511848379368988


58

LifeMiles Loyalty Program | Business Model

(US$ M)

Strong EBIT Growth and Margin Expansion (IFRS 15)2

(US$ M)

EBIT Margin (%)

263

308

356

Airline Third-Party

334

A Diversified Mix of Customers & Geographies

Gross Billings by Type¹

49%

22%

29%

Financial

Air

Direct to

Members &

Others

Costa Rica

6%

El Salvador

6%

Guatemala

6%

Other

15%

Colombia

43%

Peru

11%

USA

14%

Non-Airline Gross Billings by Geography¹

❑ Diversified geographic presence with 6 countries contributing 6%+ of gross billings¹

❑ Asset-light business model with favorable working capital dynamics, cash margin of ~45%²

of gross billings

❑ Proven management team, the core of which has been in place since 2010 and has grown

non-airline sales by 4x over the same time period

❑ On average, non-air rewards provide a 10% to 20% higher profit margin than redemptions

for air tickets

❑ With a growing customer base and partner network, non-domesticated (Colombia) gross

billings have increased by 10%+ since FY2017

Successful and Diverse Business Model

LifeMiles continues to augment its non-airline partner network to drive robust operational results and profitability

186 209246 237

7799

11097

2016 2017 2018 2019

52

81

112

133

25.6%33.1% 35.7% 39.6%

2016 2017 2018 2019

…..Is Accelerating Growth in Gross Billings

(1) Reflects FY 2019. LifeMiles revenue comes primarily from the sale of miles, which are referred to as “Gross Billings”

(2) Defined as Adj. Cash EBITDA / Gross Billings

(3) Excludes one-time non-cash breakage-related adjustment


59

LifeMiles Loyalty Program | Growth Opportunities

23 21

10 9 4

0

Financial Partnerships Retail / Transport Channels Geographic Diversification

Through a strong international network of earn (e.g; financial partners) and redemption (e.g; Star Alliance) partners,

LifeMiles effectively serves, sells to, and grows its customer base both in the airline’s core markets and beyond

LifeMiles has more co-brand credit card partnerships

than any of its Latin American Competitors

Co-branding contracts deliver diversified and

predictable sales streams vs. AVH point accruals

Miles sold through financial partnerships yield higher

margins than miles sold to Avianca & AV air partners

Co-branded credit cards facilitate continuous customer

engagement with the LifeMiles program

Network of financial partnerships enables LifeMiles to

provide a more comprehensive loyalty program

Hotels Car Rental Retail Restaurants

Members are able to utilize their accrued points as a

liquid currency outside of the airline industry

Non-airline rewards are often cheaper (fewer miles),

broadening the program’s appeal

Partnership with Uber Eats & other similar partners

critical while air travel recovers from COVID crisis

LM investing in e-commerce, mobile payments, & other

strategies to reinforce non-travel elements of program

Diversified GB1

Financial Partners in North America

have gained significant relevance

Conversion of points to miles in the US grew 241% in

‘19 vs ‘18 & represent ~42% of conversion gross billings

International partnerships enable global customers to

redeem LifeMiles’ points outside of AV core

Expansion of geographic footprint enables the business

to appeal to a broad array of travelers

(1) Non-Airline Gross Billings by Geography for FY2019

(2) Financial partners’ gross billings in the United States. Indexed for FY2017 amount.

Impressive Growth in US2 (US$ M)

Costa Rica

6%El

Salvador

6%

Guatemala

6%

Other

15%

Colombia

43%

Peru

11%

USA

14%100

154

473

2017 2018 2019

+54%

+208%

LifeMiles leverages its diversified network of partnerships across an expanding geographic footprint to accelerate growth


60

LifeMiles Loyalty Program | Entrenched Brand Recognition

2013 2014 2015 2016 2017 2018 2019 2020Last 7

Years

Best Redemption

Ability (last 6 yrs)Member Engagement Continues to Strengthen1

1 2 2 3 2 1 1 1 13 5

– – – – – – – – –

– – – – – – – – –

– – – – – – – – –

– – – – – – – – 1

1 2 3 2 4 5 3 3 23 –

3 2 2 1 1 1 1 1 12 –

– – – – – – – – –

– – – – – – – – –

LifeMiles’ award-winning brand facilitates strong member engagement across its accrual and redemption network

9.2%

6.9%

23.1%

9.0%

Total Members

Active Members Core

Loyal Members Core

Engaged Members Core

2

3

LifeMiles is indisputably the most awarded program in Latin America….only Southwest Rapid Rewards & American Advantage rival LifeMiles in all of

the Americas

(1) YoY Growth, as of Mar ’20

(2) Members active for two consecutive years in Core Markets

(3) Members who are active in two or more categories over the last 12-month period

GraciasThank you

avianca 8-year financial forecast

Documents